OptionsHouse

Options Trading News

November 20, 2012  Tue 3:16 AM CT

USB: SEE CHART GET CHAIN FIND STRATEGIES
As shares of U.S. Bancorp continued to bounce yesterday, one long-term trade was betting on a floor beneath the stock.

A trader sold 5,000 January 2014 25 puts for the bid price of $1.33, according to optionMONSTER's systems. The volume was twice the open interest in the strike at the start of the day, so it was a new position.

USB rose 1.7 percent to $32.08, building on Friday's gains and erasing its losses of last week. The financial stock was at a four-year high just above $35 in early October, but Thursday's low of $30.96 was its lowest price since June.

The put selling is a bet that USB will hold above $25 through mid-January 2014. The trader faces the obligation to buy shares on a pullback, but at an effective price of $23.67. (See our Education section)
Share this article with your friends


Related Stories

USB

Call sellers see ceiling in U.S. Bancorp

June 23, 2016

Traders apparently believe that upside potential will be limited in the financial-services company after its quarterly results next month.

USB

Is U.S. Bancorp heading for a pullback?

June 10, 2016

The financial-services firm is up 8 percent in the last three months, but a large trader apparently believes that a drop is coming in the near term.

USB

Short-term put buying hits U.S. Bancorp

June 6, 2016

Traders apparently believe that a drop may be coming this week in the financial firm, which reported mixed quarterly results in April.

OptionsHouse

Premium Services

Education & Strategy

Know the risks behind covered calls

Selling calls is a popular strategy for both retail and institutional traders, but they typically do it in very different fashions.

View more education articles »